Cash Deposits – Tax Implications

Section 68 - Cash Credits

Provisions of section 68 of the Act reads as under:

"Where any sum is found credited in the books of an assessee maintained for any previous year, and the assessee offer sno explanation about the nature and source thereof or the explanation offered by him is not, in the opinion of the Assessing Officer, satisfactory, the sum so credited may be charged to income-tax as the income of the assessee of that previous year.

Provided that where the assessee is a company (not being a company in which the public are substantially interested), and the sum so credited consists of share application money, share capital, share premium or any such amount by whatever name called, any explanation offered by such assessee-company shall be deemed to be not satisfactory, unless—